Punjab Chief Minister Capt Amarinder Singh on Friday reiterated his demand for the implementation of “principle of shared responsibilities” by the Centre to settle Rs 31,000 crore cash credit limit (CCl) gap amount that had been converted by the Union Government into long term loan.
The CCl gap cannot be solely attributed to the state of Punjab, the Chief Minister has said in separate letters to the Prime Minister Narendra Modi and the Union Minister for Consumer Affairs, Food and Public Distribution Ram Vilas Paswan.
“The gap, that had arisen due to systemic and structural reasons, should be addressed through the ‘principle of shared responsibilities’ amongst the stakeholders in the procurement process of foodgrains in Punjab,” the Chief Minister has stated in his letters, pointing out that he had raised this issue even earlier.
After his letter of January 15, 2018, a meeting on the matter was held at the level of Secretary Expenditure, Government of India, on February 20, 2018, in which representatives of the Department of Banking, Department of Food and Public Distribution, GoI, and the Government of Punjab had participated, the Chief Minister recalled.
However, no decision has yet been taken, he added, urging the Prime Minister to intervene in the matter to operationalise the suggested principle of shared responsibilities amongst the Government of India, the Government of Punjab and the consortium of banks.
Meanwhile, in separate letters to Paswan, the Chief Minister has raised the issue of release of pending VAT payment, as well as non-reimbursement of actual expenditure on procurement of gunny bags, to the State Procurement Agencies.
Capt Amarinder has drawn the Minister’s attention to his earlier communication of March 26, 2018, regarding reimbursement of VAT amounting to Rs 952 crore to the state procurement agencies.
“Although, the Food Corporation of India has admitted that the amount of VAT paid by the State Procurement Agencies is to be reimbursed, no further progress has yet been reported,” he observed, adding that as a result of delay in release of this amount, the State Procurement Agencies had to borrow to fill the gap for timely authorisation of CCl for the current Rabi Marketing Season.
The letter further said that the FCI and the Union Ministry of Consumer Affairs, Food and Public Distribution evidently could not release the requisite amount due to non-availability of funds during the previous year. However, the funds are available now and, therefore, reimbursement of VAT paid by the State Procurement Agencies should be expedited, he requested.
On the issue of gunny bags, Capt Amarinder said that though price and payment schedule of bags, procured as per supply plan approved by the Department of Food and Public Distribution through Jute Commissioner of India, is finalised in accordance with the Ministry’s directions, the actual cost incurred on their procurement, including basic cost, interest, handling and transportation cost, is not reimbursed to the State Procurement Agencies.
“In fact, the cost of gunny bags is paid out of the funds borrowed from banks as short term loan, which is repaid by FCI against delivery of food grains. Non-reimbursement of actual expenditure on gunny bags results in huge gap in CCl, causing unnecessary burden on State finances,” he pointed while urging the Ministry and FCI to reimburse actual cost of gunny bags to the State as these are purchased for foodgrains procured on Centre’s behalf.